Home / Knowledge / News / Apparel/Garments / Updates on Kaplan Fox files suit against Urban Outfitters
Updates on Kaplan Fox files suit against Urban Outfitters
26
May '11
Kaplan Fox & Kilsheimer LLP has filed the first and only class action suit against Urban Outfitters Inc that alleges violations of the Securities Exchange Act of 1934 on behalf of purchasers of Urban Outfitters common stock during the period November 15, 2010 through March 7, 2011, inclusive.

The case is pending in the United States District Court for the Eastern District of Pennsylvania. A copy of the complaint may be obtained from Kaplan Fox or the Court.

The Complaint alleges that, during the Class Period, Defendants discussed an emerging shift in fashion trends that Defendants represented was an opportunity for the Company and represented to investors that the Company would be able to manage the trend, that Company had effective inventory management controls and systems, and that Urban Outfitters inventory would "grow more in-line with sales growth."

It is alleged, however, that by the beginning of the Class Period, Defendants knew, or had reason to know, that the Company was not managing the shift in fashion trends because: (1) the Company's inventories were increasing materially more than sales, (2) sales at the Company's namesake Urban Outfitters store and Anthropologie division were materially declining due to lack of customer demand, especially for women's apparel, and (3) as a result, the Company was forced to mark down the price of inventory which materially adversely affected the Company's margins and financial results for the quarter ended January 31, 2011.

The Complaint further alleges that on March 7, 2011, investors in Urban Outfitters' stock learned the truth about the Company when, after the close of trading, Defendants disclosed the Company's financial results for the quarter ended January 31, 2011.

Among other things, the Company disclosed i) earnings of $75 million or $0.45 per share for the fourth quarter, which was approximately 13% less than the $0.52 per share expected by analysts; ii) that gross profit margin materially declined, primarily due to increased merchandise markdowns to clear seasonal inventory associated with changing women's apparel fashion trends; and iii) retail inventories increased by 10% at cost while total comparable store inventory increased by 4% at cost and total inventories grew by $43 million or 23%, on a year-over-year basis.

On March 8, 2011, Urban Outfitters shares declined from a close on March 7, 2011 of $37.99 per share, to close at $31.66 per share, a decline of $6.33 per share or approximately 17% on heavier than usual volume.

If you are a member of the proposed Class, you may move the court no later than May 31, 2011 to serve as a lead plaintiff for the Class. You need not seek to become a lead plaintiff in order to share in any possible recovery.

Kaplan Fox & Kilsheimer LLP

Must ReadView All

Textiles minister Smriti Irani at a press conference with minister of state for textiles, Ajay Tamta, the principal director general (M&C), PIB, AP Frank Noronha and other dignitaries. Courtesy: PIB

Apparel/Garments | On 23rd May 2017

Special package for knitwear coming soon: Irani

Union textiles minister Smriti Irani said that the government of...

Apparel/Garments | On 23rd May 2017

Apparel, footwear use may rise by 63% in 2030: Report

The apparel and footwear consumption is projected to rise by 63 per...

Apparel/Garments | On 23rd May 2017

Gap Inc earns $3.4 bn in net sales in Q1 FY17

Gap Inc's net sales for the first quarter of fiscal year 2017 were...

Interviews View All

Divyesh Mashruwala
Akshar Industries

Surat dominates foiling, embossing and pleating

Riddhika Shah
SS Homme

'Worsted wool is the ideal fabric for menswear'

Mohammad Mamun Ar Rashid
UL VS Bangladesh Ltd

Productivity, creativity and innovation play a vital role in the growth of ...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
May 2017

May 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search